Do You Need An Interim Executive Director?

By Bill Moran, The Moran Company

When a nonprofit Executive Director/CEO leaves, the Board of Directors often faces the question of whether to bring in an Interim Executive Director.

Below are some instances where I have seen Interim Executive Directors used effectively:

• To Maintain Operations During Search Itself. Interims are used most commonly to manage the nonprofit during the transition between the departing Executive Director and the new one. This allows valuable time to do a methodical search for a new leader without having to rush to keep operations going. These short-term placements may come from existing staff, a current board member or a retired executive. Usually, the board identifies this person from their relationships.
• To Allow Space After the Retirement of a Longtime Beloved Executive Director. A sensitive situation arises when a longtime, successful Executive Director/CEO or Founder retires or leaves. For sure, the new Executive Director is going to be different and create a different environment. If no spacing is provided, the next Executive Director may fight the “ghost” of the beloved leader and be forced out after a short time. An Interim can provide critical time and emotional space after the departure of a beloved leader. Time is needed to grieve the loss of the departing leader. For example, many religious denominations actually require an Interim pastor for one year to allow time to grieve the longtime departing pastor and create emotional space for the new clergy.
• To Address Organizational Issues. An Interim can provide valuable service to a nonprofit experiencing significant issue such as problematic staff or Board dissention. Often, these nonprofits have gone through a number of short-term executive directors. They have left due to the circumstances existing at the nonprofit. Over a 6-to-8-month period, a skilled Interim can guide the nonprofit through a discernment process to correct the problems that have hampered prior executive directors. He or she can make tough decisions such as terminating problem staff or asking certain board members to leave. He or she can put the nonprofit in a place where the new Executive Director is set up for success instead of failure. The new permanent hire does not use valuable political capital addressing the nonprofit’s dysfunction.

Interim Executive Directors are an effective solution in the right circumstances; however, it has been my experience that they are not used to the extent they could be.

Below are possible reasons why organizations choose not to use them:

• They are not always readily available when needed. The firing or sudden departure of an Executive Director creates an immediate need. The Board may not have someone in their back pocket to step in.
• Search Committees often think it is important to have overlap, or time for training, between a longtime highly respected director and the new director. This cuts out the possibility of an Interim to create space between the old and the new.
• An Interim often lengthens the time between permanent leadership. Board and staff do not deal well with ambiguity of “in between” time. Often, they want to get the permanent person in place as soon as possible.
• If serious organizational issues exist, the Board will hope the new person will address and solve them as opposed to bringing in a skilled Interim.
• Bringing in an Interim may delay larger strategic decisions that require the input and ownership of a permanent executive director.

Costs vary greatly. Some retired nonprofit executive directors who live locally may come in for a modest daily rate. Board members will have to identify and reach out to these individuals.

Professional Interim Directors may charge the same fee as the salary paid to the outgoing ED but only come in 4 days a week. Because they are independent contractors and not employees, the nonprofit may save up to 20% employee-related costs such as Social Security and retirement. Read more about a national network of professional nonprofit interims at Interim Executive Network.

During certain circumstances, Interim Executive Directors can fill a critical role in maintaining operations during the search itself. They also can prove invaluable when a longtime CEO retires or when serious organizational issues must be addressed prior to a permanent hire. Part of the Board’s planning should be to identify local retired nonprofit executives who might step in should the need arise. The Moran Company can provide additional advice prior to your search, and we invite you to contact us for a free 30-minute consultation if we can be of service.